Ford partners with Alibaba on online car sales

American carmaker Ford has signed an agreement with Chinese e-commerce giant Alibaba to collaborate with online car sales, new transport services and artificial intelligence.

Jim Hackett, Ford Motor CEO, and Daniel Zhang, Alibaba Group CEO, met at Alibaba’s headquarters in Hangzhou to witness the signing of a letter of intent between the two companies.

China is the world’s largest car market and the world leader in online car sales, according to the Financial Times.

Alibaba said under the three-year agreement, both companies would work on solving several of the problems presented by consumers buying vehicles online, including test drives and leasing options, as well as working on connectivity and other services.

It added that Ford will also cooperate with Alibaba’s four business units— operating system AliOS, cloud computing service Alibaba Cloud, digital marketing platform Alimama and online retail platform Tmall— and jointly explore a variety of areas of cooperation including mobility services, connectivity, cloud computing, artificial intelligence and digital marketing.

Hackett said the move is part of a major push into the country, with plans to launch 50 models by 2025, including a suite of electric and hybrid vehicles.

“China is one of the world’s largest and most dynamic digital markets, thriving on innovation with customers’ online and offline experiences converging rapidly,” he said.

“Collaborating with leading technology players builds on our vision for smart vehicles in a smart world to reimagine and revolutionise consumers’ mobility experiences.”

The collaboration is Alibaba’s first with a foreign carmaker. It previously partnered with domestic carmaker SAIC to launch an internet-connected car powered by the AliOS operating system.

Zhang said by leveraging their expertise, both companies will investigate ways that mobile technology could redefine online retail marketing and distribution strategies.

“Alibaba is excited to redefine our consumer journey and user experience for automobiles together with Ford Motors,” he said.

“Our data-driven technology and platform will expand the definition of car ownership beyond just having a mode of transportation and into a new medium for smart lifestyle.”

Meanwhile, Alibaba also announced it would launch two fully automated car vending machines in Shanghai and Nanjing by January 2018.

The company said depending on its success, it would roll out more such automated car dealerships across China.

Under the scheme, cars will be listed on the company’s Taobao shopping app where buyers can take a picture of cars they like on the street.

The prospective customers then take a selfie and add some personal information, which is used by the facility to identify the person before releasing the car for a test drive.

Initially, users have a three-day period to try the cars out before confirming the purchase and once decided, the payments will be made through the app or a return will be scheduled.

It added that to limit misuse, there would be a limit of five test drives every two months and customers need to be Alibaba Super Members, based on the company’s credit system.